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Marketing in the Digital Age

Forces Shaping the Digital Age

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Forces Shaping the Digital Age

Digitalization &
Connectivity

Intranets connect
people within a
company.
Extranets connect a
company with its
suppliers, distributors,
and outside partners.
Internet connects
users around the world.

Internet Explosion
Explosive worldwide
growth forms the
heart of the New
Economy.
Increasing numbers
of users each month.
Companies must
adopt Internet
technology or risk
being left behind.
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Forces Shaping the Digital Age

New Types of Intermediaries:
Direct selling via the Internet bypassed
existing intermediaries
(disintermediation).
Brick-and-mortar firms became clickand-mortar companies.
As a result, some click-only companies
have failed.
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Forces Shaping the Digital Age

Customization and Customerization:
With customization, the company
custom designs the market offering for
the customer.
With customerization, the customer
designs the market offering and the
company makes it.
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Marketing Strategy in the Digital Age

Requires a new model for marketing
strategy and practice
Some suggest that all buying and selling
will eventually be done electronically
Companies need to retain old skills and
practices but add new competencies
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E-Business in the Digital Age

Involves the use of electronic platforms
to conduct company business.

Web sites for selling and customer

relations
Intranets for within-company
communication
Extranets connecting with major suppliers
and distributors

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E-Commerce in the Digital Age

More specific than e-business.
Involves buying and selling processes
supported by electronic means,
primarily the Internet.
Includes:
e-marketing
e-purchasing (e-procurement)

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E-Commerce Networks

Global eXchange Services (GXS) consists of more than 100,000

trading partners in 58 countries. GXS completes some 1 billion
transactions each year, accounting for $1 trillion worth of goods

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E-Marketing in the Digital Age

The marketing side of e-commerce.
Includes efforts to communicate

about, promote, and sell products

and services over the Internet.
E-purchasing is the buying side of ecommerce.
It consists of companies purchasing
goods, services, and information from
online suppliers.
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Benefits to Buyers
Convenience
Buying is easy and private
Provides greater product access and
selection
Provides access to comparative
information
Buying is interactive and immediate
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Benefits to Sellers
Powerful tool for building customer
relationships
Can reduce costs
Can increase speed and efficiency
Offers greater flexibility in offers and
programs
Is a truly global medium
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E-Marketing Domains

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B2C (Business to Consumer)

The online selling of goods and

services to final consumers.

Expected to generate $428 billion in
2004.
There is increasing diversity in buyers.
This provides increasing opportunities for
targeting markets.

Is customer initiated and controlled.

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B2B (Business to Business)

By 2005, more than 500,000 enterprises

will participate as buyers, sellers, or both.

Most major B2B marketers offer product
information, purchasing, and support
services online.
Open trading exchangeshuge specialty
e-marketspaces to conduct transactions.
Click Here to Visit Covisint's Web Site

More private trading networks being

developed.

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C2C (Consumer to Consumer)

Occurs on the Web and includes a

wide range of products and services.

Forums: discussion groups located on
commercial online services.
Newsgroups: the Internet version of
forums.

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C2B (Consumer to Business)

Consumers can search out sellers,

view offers, initiate purchases, and

give feedback.
Example: on priceline.com, one can bid
for airline tickets, hotel rooms, etc. and
decide whether to accept company
offers.

Click Here to Visit priceline.com

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Types of e-Marketers

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Click-Only Companies
E-tailers
Enabler
Sites

Content
Sites

Types of
Sites

Search
Engines
and Portals
Internet
Service
Providers

Transactio
n Sites
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Reasons for dot.com Failures

Poor research or planning.
Relied on spin and hype instead of

marketing strategies.
Spent too heavily on brand identities.
Devoted too much effort to acquiring
new customers instead of building
loyalty.
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Click-and-Mortar Companies
Most established companies resisted

adding Web sites because of the potential

for channel conflict and cannibalization.
Many are now doing better than click-only
companies.
Reasons:

Trusted brand names and more resources

Large customer bases
More knowledge and experience
Good relationships with suppliers
Can offer customers more options
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Setting Up for E-Marketing

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Types of Web Sites

Corporate Web Site:
Designed to build customer goodwill
and supplement other sales channels.
Offers information to customers.
Builds closer customer relationships.
Generates excitement about the
company.
Marketing Web Site:
Engages consumers in an interaction
that moves them closer to a direct
purchase.
Provides information about the
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Designing Attractive Web Sites

Context
Commerce

Content

The 7 Cs of Effective
Web Site Design

Connection
Communication

Community

Customization
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Online Ads and Promotion

Forms of online advertising & promotion:

Banner ads & tickers (move across the screen)

Skyscrapers (tall, skinny ads at the side of a page)
Rectangles (boxes that are larger than a banner)
Interstitials (pop up between changes on Web site)
Content sponsorships (sponsoring special content)
Microsites (limited areas paid for by an external
company)
Viral marketing (Internet version of word-of-mouth)

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Viral Marketing

Gillette used viral marketing

to introduce the 3-bladed
Venus razor for women,
greatly expanding the
audience reached by its
Reveal the Goddess in You
truck tour and beach-site

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The Future of Online Advertising

Web communities:
Allows members to congregate online
and exchange views on issues of
common interest

E-mail:

Use of enriched e-mail messages

Backlash against spam can be problem
Allow people to opt-out of promotions
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Legal and Ethical Issues

Online privacy
Online security
Internet fraud
Segmentation and discrimination
Access by vulnerable or unauthorized
groups

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